Travel Management Companies Battle the Content Gap

The travel management company's first purpose was to print paper airline tickets and deliver them to travelers. TMCs since have diversified into duty of care, reporting and consulting, but in order to stay in the booking business, AmTrav CEO Jeff Klee said, they have to close the content gap. "It's not sustainable to offer less than the full menu of products that airlines and hotels offer," he said.

"There's a lot of content in terms of options, ancillaries and rich details about the products that are available on supplier sites that are not available in corporate booking tools or GDSs," Klee said. "For reasons that I don't understand, the corporate market has accepted this. There's just this acceptance of the idea that you can't get everything that you have on the supplier site in the corporate booking tool." As a matter of routine, travelers from some AmTrav clients book on a corporate booking tool and then go immediately to the airline website to get the seat. That's crazy, as far as Klee is concerned.

Sounding a lot like Klee, WTMC CEO Sarosh Waghmar said, "The biggest problem is: All the content is not there." He was referring to a different kind of content, though. While Klee bemoaned the lack of extras like seat upgrades and Wi-Fi, Waghmar aches at the actual fares missing from global distribution systems: rates from many hotels, low-cost carrier fares and even some fares from major carriers.

The bane of TMCs' existence, he said, is when a traveler speaks that famous, cringeworthy line: "I found something cheaper." Traditionally, he said, GDSs have formed the sole point of sale for TMCs. By contrast, travelers look at multiple channels. To illustrate, Waghmar, sitting in his New York office, pulled up United's website and found tickets from Bombay to New York ranging from $5,000 to $6,000. Then he clicked the India flag at the bottom of the website, switching to the India version of United's site, and found fares from $2,500 to $3,000. Just as Waghmar looked in more than one spot, travelers look beyond their corporate booking tools, and thus they find different results. That's jarring, and it shakes travelers' confidence in their companies' preferred channels. They'd say the TMC is robbing them, he said. Amazon shows different shoppers the same price, but the TMCs and the GDSs don't play like that, he said. Rather, the search results depend on the commercial relationships among the airlines, GDSs and TMCs.

It's a huge problem that there's this content gap."

AmTrav's Jeff Klee

Shortcomings considered, Mike Qualantone, EVP of global supplier relations for American Express Global Business Travel, believes GDSs still form the best-value way for TMCs to get content. They provide 99 percent of the content Amex GBT customers need, he said, and they do it in a cost-efficient way. Qualantone noted that for two European airline groups that have enacted surcharges on GDS bookings—Air France-KLM and International Airlines Group—Amex GBT has contracted exceptions to those surcharges. Access to that surcharge-free "private channel," as it's been called, has been made only to large TMCs, however.

He also said GDSs are getting better at presenting ancillaries with point-of-sale tools for travel agents who are willing to give up their green screens. Sabre Red Workspace is one example, he said, and the other GDS operators also offer graphical user interface, point-and-click platforms. The airlines, though, have to provide content for such platforms. Travel Leaders Corporate president Gabe Rizzi agreed that GDSs have employed richer content. They're proven and have the best "computing capability to deliver content in a meaningful way," he said, adding, "The best aggregator—for now, at least—is the GDS."

Whose Responsibility Is It?

The corporate travel industry seems united on the concept that a complete collection of booking options should live in one place. The question of who should make that happen, though, is where opinions scatter. At the BTN Group's recent The Beat Live conference, John Snyder, CEO of mega travel management company BCD Travel, expressed disappointment, that Lufthansa, International Airlines Group carriers and others are making "one-off decisions" to withhold some content from the GDS—and indeed are surcharging GDS bookings and incentivizing bookings through New Distribution Capability channels and direct connects. In Snyder's view, those airlines are letting the corporate travel programs down: "I just don't think they've got the customer at the core of the decision process. … They haven't said, "Is this really the right thing to do for our customers? I believe that every airline has the right to distribute inventory the way they want to distribute inventory, but I also think you need to keep the customer in mind when you're doing that."

Snyder does note, however, that TMCs can take steps to bring in other content. "That's really what our focus is at BCD: to make sure that if there is inventory outside of the GDS, we're going to have visibility for our customers of that inventory."

Though Qualantone questioned major suppliers that don't make content available on the GDS, he said Amex GBT also would find ways to get such content for customers. "We all know one airline likes to limit access to their content," he said, ostensibly a reference to Southwest. "When you make your content broadly available, you allow people to shop it and compare it." When the TMC pulls in non-GDS content, whether from aggregators like Travelfusion or from direct connects, costs factor in. "We have to make sure our customers are aware of that. We have many customers who want us to go book that airline's content, and we fully, fully support that."

Referring to direct connects as an example, though, he said: "But how do you then handle pricing, and how do you handle the shopping? How do you handle refunds, exchanges, cancellations? How do you combine air with car and hotel? How do you shop that one airline in a direct connect against all the other airlines? There's a whole lot of cost, functionality and distribution components."
Imagining a World in Which the GDS Is Just One of Many Content Sources

Klee and Waghmar, meanwhile, view GDSs as one of many sources of content. In fact, each has made as-complete-as-possible content stacks a cornerstone of his company's value proposition. Waghmar's WTMC views GDSs as a source of content on par with NDC direct connects, aggregators and online travel agencies. Klee's AmTrav gets what it can from the GDSs but takes it upon itself to supplement liberally from other sources.

WTMC doesn't take incentives from GDSs, as virtually all other TMCs do. "If you want to build technology that is truly disruptive, that will actually lead throughout the industry, you have to start looking at the distribution channel purely for distribution, not for fees or not for processing," Waghmar said. "Pull in the content, figure out where to transact elsewhere, figure out how you can build out profiles and all of that separately because those kinds of technology platforms are available. You have to build all of that and bring all of that together in the ecosystem."

He's flabbergasted that TMCs resist being technology providers, that they leave that to the GDS operators, Concur and other online booking tools, especially as NDC opens doors to non-GDS ways of transacting bookings. "I can build an actual full stack," he said. "I have my own global data warehouse. I'll use the GDS for what it is good for. I'll build out my NDC pipes." He acknowledges he can't do that on all the airlines in the world—"I have a life, too"—but said he can do it on the 20 airlines that matter to WTMC clients. "We'll work with them, put all their best content out, aggregate all of that, build out that platform and push that kind of travel or experience to the client."

Waghmar said NDC not only will provide content for the airlines his clients use most but also will reveal the true cost of a trip. Traditional TMC/GDS bookings could show a travel program that a traveler spent $500 on a fare. But there's more to the real cost. Purchases made through WTMC's NDC connections to airlines also could capture upfront the $20 that traveler spent on Wi-Fi and the $100 he or she spent on checked bags. Plus, those ancillaries would be associated with the ticketed trip. WTMC does work with third-party booking tools like Concur, but now that it's got NDC work underway with American Airlines, Lufthansa, British Airways, United and other airlines, WTMC is working on its own booking tool to present the data and help travel managers manage travel policy and the content they choose to make available.

The biggest problem is: All the content is not there."

WTMC's Sarosh Waghmar

AmTrav, like WTMC, is working on NDC pilot programs with airlines. NDC is "a step in the right direction, although it's too small, too slow a step, in my opinion," said Klee, "but at least it's moving the ball forward." He said the existing travel agency workflow was designed for an era that predated branded fares and ancillaries. The traditional agent desktop and OBT have emphasized finding the lowest fare for a flight rather than showing multiple fares from basic economy or regular economy to premium economy or extra legroom. Airline websites, meanwhile, enable travelers to see instances when business class is only $50 more or extra legroom is only $20 more, and those upgrades might be worth it for the price to travel programs, Klee said.

TMCs should be more open to NDC, he said. "Other TMCs say things like, ‘Oh, sure, I'm fine with NDC, as long as I don't have to change anything about my existing workflow.' We all have to wake up to the reality that we do need to make some changes and we don't want things to stay the same. We should all want to shake up our workflows in order to close the content gap that we struggle with today." NDC promises to change that, he said, but is still in its infancy.

So while Klee is optimistic about NDC, he's not waiting for it to mature and reach critical mass. The TMC has built a content stack for the here and now. If airlines allow comparison shopping among their own fares and GDSs allow comparison shopping of base fares across most airlines, Klee wants business travelers to be able to compare the true cost of multiple fares, including ancillaries, from multiple airlines. The company has spent years building a booking tool and, for domestic flights, a pricing engine. While a typical GDS search yields a list of flights and the lowest price for each, AmTrav queries the GDS for all fare and flight options—just the raw data, no value algorithms necessary—and then aggregates those availabilities with its own database of airlines' ancillary pricing to present a true-cost-of-flight booking option in its booking tool.

All told, AmTrav uses content from GDSs, aggregators and an increasing number of direct connects and supplements it both with its own databases of brands' fare rules and amenity content, including images, and with Routehappy rich content. Klee said the goal is to provide travel programs with a gluttonous amount of information, even more than an airline's website if he can: not just whether a flight has Wi-Fi, for example, but how good the Wi-Fi is, details on inflight entertainment and even seat dimensions. "It's quite an effort [to keep it updated], and we would love not to have to do that," he said. "The GDSs are slowly getting there, and NDC connections, when they're widely available, will also make some of what we do unnecessary. We're kind of anxious to get to that day, but we don't want to wait for that day" when NDC is viable and at scale.

Qualantone said Amex GBT supports NDC but wants GDSs to lead the way on this content source, too. "We're pressing technology providers, mainly GDSs, to solve for that," he said, adding that this would allow GDSs to absorb dynamic content from airlines. Rizzi also is a GDS guy. "As the GDSs evolve and as the GDSs bring in new content, we're obviously going to serve that up to our clients," he said.

The End Is Nigh?

According to Klee, if TMCs don't get it together—the content, that is—Concur TripLink, Traxo and others that capture off-channel bookings and aggregate travel program data will take the booking business off TMCs' hands.

There also are corporate booking engines aggregating diverse data sources. Serko integrates with Amadeus, Apollo, Galileo, Sabre and Travelport GDSs; air carrier Qantas; aggregators AgentWare and Travelfusion; and Routehappy, and it's working on direct integrations with airlines, said North America SVP Tony D'Astolfo.

I believe that every airline has the right to distribute inventory the way they want to distribute inventory, but I also think you need to keep the customer in mind when you are doing that."

BCD Travel's John Snyder

TravelPerk launched in 2015 and is gunning for established TMCs and booking tools with its consumer-friendly technology and a variety of content feeds: One-third of bookings go through GDSs, 22 percent through aggregators and half via application programming interface direct connects. On top of that, chief commercial officer Jean-Christophe Taunay-Bucalo claimed NDC will be a snap for the company: "For us, it's very easy to integrate NDC because we are a tech company. It's what we do every day. Traditional TMCs struggle way more than we do with technological shift." There are signs that it's an easy time for digital booking platforms to take over from TMCs, he said.

And then there's TripActions, which wants to beat out the mega TMCs. CEO Ariel Cohen calls his company "a new kind of TMC." It doesn't rely on GDS incentives, and it aggregates GDS, OTA, direct connect and other aggregator content and even merges passenger name records from multiple vendors into one trip.

Klee referenced the danger of off-channel-booking aggregators, but he also could have included this new wave of booking platforms when he said, "It's a real existential threat to TMCs and the current model. I don't see TMCs ever going away, but either they solve the problem of providing a good booking experience or they get out of the booking business."